Project finance a win-win for government and investors
Green or social projects would be particularly attractive for those wanting a safe return on their capital
Project finance offers governments an attractive option for the financing of public infrastructure. By relying on private funding, the public sector borrowing requirement is reduced.
SA’s 2020 Budget Review projected public sector infrastructure spending over the next three years of R815bn, of which 75% is for economic infrastructure. The government’s borrowing costs have risen sharply after successive sovereign rating downgrades. An alternative approach such as project finance is not only attractive when the government’s finances are under pressure, but also serves to widen the pool of opportunities available to investors. ..
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